Ukraine meets all structural benchmarks for IMF mission expected in late May - deputy finance minister

MOSCOW. May 21 (Interfax) - Ukraine has fully met all structural benchmarks and other commitments under the Extended Fund Facility (EFF) program with the International Monetary Fund (IMF), whose mission for the program's fourth review is to start in Warsaw in late May, Ukrainian Deputy Finance Minister Olga Zykova told Ukrainian media.

"All structural benchmarks have been met. After we received positive news from the United States, we have a clear idea of the work plan with the European Union on the Ukraine Facility and the corresponding tranches, and we can say that we are engaged in the program and are fulfilling our obligations," she said on the sidelines of the second Luxembourg-Ukrainian business forum Rapid Recovery of Ukraine organized by the Luxembourg-Ukrainian Commerce and Industry Chamber in Luxembourg on Tuesday.

The mission will also focus on structural work to ensure that Ukraine remains under the program in the future, and will elaborate a work plan for the program's fifth review scheduled to take place before the end of the year, Zykova said.

"There are no critical points," she said.

"We need to understand that we have guarantees that the program will be fully continued by the partners until the end of the four-year period [...]. [There is] a very simple, but at the same time important link between the predictability and timeliness of external financing and, accordingly, what fiscal measures, monetary measures we take," Zykova said.

Ukraine went through the first months of this year in the absence of the European Union's and the United States' funding, which was partially compensated by Japan and Norway, almost at the expense of domestic measures, namely, tax on excess profits of banks and the early payment of dividends by the largest state-owned companies, she said.

"They [the measures taken] did not have a destructive impact on the economy, which is positive, but at the same time, these are measures that can be taken once. And we would not like to undertake measures that would have an adverse impact on the economy and on the system as a whole," Zykova said.

Ukraine is holding and will continue to hold active negotiations with both the U.S. and the EU on the mutual predictable compliance with its commitments, she said.

As reported, the four-year EFF program totaling around $15.6 billion was approved on March 31, 2023, and is part of a $122 billion package of international support for Ukraine. The first $2.7-billion disbursement was provided in early April, with the second and third tranches of SDR664 million (around $881 million - $890 million at the then exchange rate) extended in early July and mid-December 2023.

At the end of March this year, the IMF Executive Board approved a fourth disbursement to Ukraine following the third review, when the compliance with the obligations was assessed as of the end of December 2023. Three more disbursements are scheduled for 2024 following the respective program reviews: SDR1.670 billion ($2.21 billion) in mid-June, followed by another two tranches of SDR835 million each in early September and December. Two disbursements are scheduled for 2025: SDR684 million in early March and late August, followed by three more final tranches of SDR966 million.